Banks, Fannie Mae and Freddie Mac you are ripping the American consumer off. In the last 4 weeks, we have had 4 short sale offers declined by banks. WHY?
I will tell you why. Banks are getting refunds from Freddie Mac and Fannie Mae to cover their losses. When a bank takes a loss of $50,000 the government gives it back to them. Check out this YOU TUBE site and it helps explain http://www.youtube.com/watch?v=ssl5yb7FewA&aia=true
I hopes this link works because it clearly illustrates the banks getting money behind the scenes. Why else are so many short sales being denied? Why are banks not processing offers? I believe it’s a racket and that is why the banks are showing profits.
Spread the word. Lets complain and stop this travesty.
Over the past week, Congress has taken quick action and passed H.R. 5981. The bill gives FHA the authority to adjust its annual mortgage insurance premium, yielding approximately $300 million per month in value to the FHA Mutual Mortgage Insurance Fund at a time when its reserves are perilously low.
As I have previously stated in my testimony before Congress, FHA will lower its upfront premium simultaneously with the increase to the annual premium¹. It is our intention that effective on September 7, 2010, FHA’s upfront mortgage insurance premium will be adjusted down to 100 basis points on all amortization terms and the annual mortgage insurance premium will increase to 85-90 basis points on amortization terms greater than 15 years². A Mortgagee Letter will be forthcoming once President Obama signs the bill into law, but with today’s passage of H.R. 5981 and our expedited implementation schedule, I wanted to immediately inform the industry of our plans so the lending community can begin preparing for the operational and system changes required to implement FHA’s new mortgage insurance premium structure on all new case numbers by September 7, 2010.
With this authority, FHA is in a better position to address the increased demands of the marketplace and return the MMI fund to congressionally mandated levels without disruption to the housing market.
While we appreciate and applaud this recent action, there is still work to be done. HUD remains steadfast in its commitment to comprehensive FHA reform legislation, similar to the FHA Reform Act passed earlier this year by the House, which would further enhance FHA’s lender enforcement capabilities and risk management efforts. We hope Congress will take swift action to pass a broader FHA reform bill when they return from the August recess. FHA’s risk management efforts will not be complete without the ability to monitor lender performance and ensure compliance with our rules.
Although the transition timeframe is short, implementation by September is critical. Thank you in advance for the efforts of you and your organization to make this change happen on such short notice. We appreciate your hard work and continued partnership.
¹The upfront and annual premium changes do not apply to the following FHA Programs: Title I, HECM, HOPE for Homeowners (H4H), Section 247 (Hawaiian Homelands), Section 248 (Indian Reservations), Section 223 (e) (declining neighborhoods), Section 238(c) (Military Impact areas in Georgia and New York).
² LTV’s <= 95% will increase to 85bps and LTV > 95% will increase to 90 bps
Sellers are you smoking Hopeium? Homes will sell if they are priced right and in good condition and staged to show. I recently went showing some homes in the Woodmoor/Tri Lakes area. I was amazed how poorly homes were showing between $300,000-$400,000. We saw peeling paint, weedy yards, run down carpet, heavy pet odors and busy streets.
The people I was with dropped their price $100,000 to get it to the right price. I then had it staged and we sold it for $575,000 in month. I have sold 20 homes this month. I would like to publicly thank my SELLERS in Briargate, Downtown, Fountain , Powers, Norwood, Black Forest, Rockrimmon and Broadmoor for listening to my pricing strategies and applying our staging services.
The market is what it is. Sellers you need to get real and understand that buyers know value and will not overpay. Get real and prepare and your hope will sell.
Quit smoking HOPEIUM and get a clear view of the market and you will see success!
I know you’ve been experiencing “new lending” practices from all lenders around the country. For a long time here at Bank of America, I thought it was just us tightening the lending requirements to this degree. But as I talked to friends in the industry (Wells Fargo, Chase, and Citi) and watched other loans that are perfectly good loans struggle to close it became apparent that we are into this for the long haul. I think from our team stand point, the best thing you can do to help the Buyer get through this “new lending” is from the beginning to set the expectation that …there is a new sheriff in town and the name of the game is explain everything.
Income – two years….I know what the guidelines say, but two years same employer or same line. Must document. Verifications happen at the beginning of the loan process and yes, on the day of closing….someone could quit..and have. I’ve been asked, why didn’t they verify the employment sooner in the loan process and the answer is that we do…we just do it again on the day of closing. For self employed, two years of tax returns. If they started their company in the middle of a year…you’ll have to be self employed for two full tax cycles so in this case 2 and a half years.
Credit – 620 (yes, 580 is possible, but beat your head against the nearest wall – this simply means when you are writing a contract for someone in this situation – give more time to close because it usually requires more than one level of underwriting. And guaranteed there will be many letters written to the Underwriter. The article says that 75% of the loans purchased by Fannie Mae had 720 or better scores. That means that FHA is picking up the rest…so yep, more FHA buyers on our plates (see why FHA 203K is becoming a popular loan).
Letters of Explanation – have become huge. It used to be that we’d do a quick “note” to the Underwriter and call it a day. Not anymore, we now have to write letters explaining almost everything: deposits into the bank account that are not payroll, addresses on the credit report that the borrower never lived, or even explaining 10 year old derogatory entries on credit (got any documents to back that up?).
Paying for appraisals and credit reports – in the past I never collected money up front, I considered it a cost of doing business and in my 18 years I’ve probably paid for $3500 in appraisal costs over the years. Not bad. Not anymore. Fees have to be paid upfront or the loans can’t go into processing/underwriting. The reason for this is simple, the Appraiser wants paid whether the loan closes or not.
30 day closes – I thought these were going to become a thing of the past, but not so fast. I think the automation has caught up with the demand for 30 day closes on standard work flow.
You know how the saying for Realtors is “location, location, location”. Well our saying is “document, document, document”. The above article is great at explaining the buyback Lenders are experiencing and hopefully helps you to understand that when I ask the Buyer for a DNA sample, that I really do need it for loan approval; see the pendulum really has swung too far, it will swing back, but for now to be successful we have to document, document, document.
I for one say enough with tax credits to help the housing market. It’s time the real estate market deals with the issues that ail it. The market is over supplied still with homes that are overpriced and over loaned. We need to deal with this head on to get through it
Yes the tax credit was a good thing, but now, the buyers are waiting again for it to come back. If we as a government eliminate it, the buyers will come into the market to enjoy great interest rates. The sooner buyers quit waiting, the sooner we get through the inventory and the sooner to a balanced market.
The tax credit is a crutch that we need to forever more leave behind. Loosen mortgage guidelines. Give people loans with 5% down payment and lower the credit score requirements. Over 40% of the public is having financial distress. Loosen the guidelines and allow people to stay in their homes and eliminate ½ of the foreclosures. Banks get off you *** and work with sellers and homeowners. If banks would work faster and efficiently through the defiencies, it would solve lots of our problems. But, NO, they keep taking the government bailout and pocket it themselves.
Bottom line! Government get out of real estate. Then lenders and investors might start solving all the loan issues that plague us.
Good morning all. More changes are here in regards to FHA backed mortgages. While these changes don’t have a big impact it’s one more obstacle for the buying public.
Product/Program Changes:
Change
Current Factors
NEW Factors
FHA Upfront Mortgage Insurance Premium Factors
Purchase and Rate and Term Refinances: 1.75%
Streamline Refinances: 1.50%
Purchase and Rate and Term Refinances: 2.25%
Streamline Refinances: 2.25%
Note: Annual MIP is not affected with this change
As you can see not a real big deal. FHA still allows a buyer a low downpayment. I have always believed a buyer should have some “skin” in the game and this is a nice alternative for financing.
Pleas give us a call if you have any more questions.
Its February 19th and its cold cold outside. I am ready for winter to be over. It has been so cold that our signs are frozen in the ground and we need a 10lb sledge hammer to pound them in.
I don’t know about you, but in a perfect world, the mountains could get 6’ of snow and we should enjoy 60 degree plus weather here. Wouldn’t it be nice to always be able to go outside and exercise? I haven’t been able to golf since the last week of November. That’s a real long time!
I know I’m not so sure about global warming. I feel all this weather is natural evolution. It’s the ebb & flow of the ocean and tilts of the earth. I know I would like a little global warming here in Colorado Springs. What do you think?
Well in the meantime I won’t be here next week Palm Desert and hot weather is calling. Have a great week.
Did you read this morning’s Gazette Telegraph about Colorado Springs and its budget woes. People we have made national headlines with our budget cuts. ABC News, NBC News and even Canadian News has brought attention to our Colorado Springs area. We are the national poster child of budget cuts. People are you happy now?
Are you happy that your street lights have been turned out? Are you happy that there will be no water for our parks and that trash cans have been removed? Are you happy that the city is selling both of the police helicopters? I bet you folks in Powers, Briargate and Central areas are thrilled to know the police can’t get there fast enough. How about that fire call? When your home has burnt 5 minutes longer I bet you’ll be happy to know that you’re saving taxes.
I think you get the point. I am not happy. I have been preaching for years that inner city residents need to approve some spending for their schools. Now the majority voted “NO” across the board for taxation. Look at what we have now. We have a city that new jobs don’t want and our own people won’t support.
This week Forbes Magazine rated Colorado Springs the 9th Best Bang for the Buck city in the United States. The top city was Omaha NE. This is more good news for our little city. Last week Forbes rated us 14th most likely city to rebound from the housing slump.
I believe Colorado Springs is a good value. In affordable housing, most of our prices hover between $90-$110 per feet. In the heyday it rose to $130-$150 per foot. The one golden thing that has happened with the housing slump is that it’s made housing affordable again. In Colorado Springs you can find decent housing around $100,000. In markets like Florida, Arizona, Las Vegas and California home prices dropped 50-70% from the peak. Now there is value in owning a home.
I also think now is the time to buy and invest in real estate. Many people catch it when its on its way up. Almost always people buy into the frenzy when it’s peaking. Now is the time. We have been at bottom for about 8 months. I think we will stay here for only a couple more months before we start increasing values. Fact is, sales this year in 2009 are equal to 2006 and inventory is down 1800 units. That spells relief and increasing values.
Yes, buy into the fact that Colorado Springs is a good value. Say yes that Colorado Springs is rebounding. Get on board the bus before it passes you by.
Did you see the article by Forbes Magazine listing Colorado Springs as the 14th fastest recovering city in America? Do you believe it? Are we really in for a rebound? Well, let’s see!
Forbes online produced a list yesterday that names Colorado Springs the 14th most likely place in America to Rebound. It ranked Omaha NE #1 most likely. It took into account Gross Metropolitan Product (measure of city economy) foreclosures, home prices, and sales rates. They ranked based on statistics compiles through the month of September.
I think this is great news but is it really true? Now that Doug Bruce has gotten his way in raping our city dry, are we really going to be a quality place to live? By voting for his anti tax measures I feel our city is going to dry up and die. You don’t need to look far to see it.
1st check out our infra-structure and roads. Why do we waste money on a bridge overpass at Woodmen & Academy but vote down public transportation? Why are we closing inner city schools and not putting money into educating Dist 11 kids. Today Dist 11 can’t make ends meet and those of you who don’t have kids in school you keep voting down amendments. That is why your home values don’t climb like other areas. How many of you were fooled by Doug Bruce’s amendment for abolishing storm water. Soon, you will figure out when curb gutter and sewer systems don’t work it was your vote that caused it.
People you need to be more long term thinking! You need to look past the slight increase and look at the big picture. No real airport, bad schools, no public transportation, brown grass parks, broken curbs, gutters, sewers, pot holed streets and slow fire and police protection does not make us an appealing place to live. If we are not appealing you won’t get good prices for your homes. People you need to think beyond today and look to tomorrow. If you don’t we certainly won’t be a top place to live.
This week’s Blog is being written by my friend Peter Davidson. He is an expert with reverse mortgages. We will be having a seminar on October 22, 2009, at 6:30 at my office (5590 North Academy Blvd.) Please call me at 593-2963 if after reading the following article if you would like to come. Please enjoy and we hope to see you soon!!
Thanks,
Brian
What is a Reverse Mortgage?
Simply put, a reverse mortgage is a loan that enables homeowners aged 62 and over to tap into their home equity.www.ReverseMortgageGuides.org says “A reverse mortgage is a low-interest loan for senior homeowners that uses a home's equity as collateral. The loan amount is a percentage of the home's value determined by the age of the youngest homeowner. The loan does not have to be repaid until the last surviving homeowner permanently moves out of the property or passes away. At that time, the estate has approximately 12 months to repay the balance of the reverse mortgage or sell the home to pay off the balance. All remaining equity is inherited by the estate. The estate is not liable if the home sells for less than the balance of the reverse mortgage.”
History of Reverse Mortgages
Many people believe that reverse mortgages are fairly new, when actually the first reverse mortgage was done by Deering Savings & Loan in Maine during 1961.Growth was very slow until 1988 when the Federal Housing Authority Insurance Program was signed into law.The first government-insured reverse mortgage was given in 1989 under a pilot program initiated by the federal government under the guidance of the AARP.The program was small to begin with, but was expanded nationwide due to its success.
Since then in excess of 400,000 reverse mortgages have been done in our country.
Why a Reverse Mortgage?
The FHA reverse mortgage was created to allow seniors to stay in their homes for the rest of their lives.The homeowner can receive payments in a variety of ways; monthly payments, lump sum payment, line of credit, or any combination, and because they are receiving rather than paying, they can never be evicted or foreclosed on for non-payment.Reverse mortgages are easy to qualify for because there are no credit or income requirements.
What Can Be Done With The Proceeds of a Reverse Mortgage?
According to a report on the 2006 AARP National Survey of Reverse Mortgage Shoppers, the top 5 uses of a reverse mortgage are:
Expenses for health or disability
Improve quality of life
Pay off debt
Home repairs and improvements
Everyday and emergency expenses
The proceeds are not taxable and the borrower can do almost anything they want with them.
This week’s Blog is being written by my friend Peter Davidson. He is an expert with reverse mortgages. We will be having a seminar on October 22, 2009, at 6:30 at my office (5590 North Academy Blvd.) Please call me at 593-2963 if after reading the following article if you would like to come. Please enjoy and we hope to see you soon!!
Thanks,
Brian
What is a Reverse Mortgage?
Simply put, a reverse mortgage is a loan that enables homeowners aged 62 and over to tap into their home equity. www.ReverseMortgageGuides.org says “A reverse mortgage is a low-interest loan for senior homeowners that uses a home's equity as collateral. The loan amount is a percentage of the home's value determined by the age of the youngest homeowner. The loan does not have to be repaid until the last surviving homeowner permanently moves out of the property or passes away. At that time, the estate has approximately 12 months to repay the balance of the reverse mortgage or sell the home to pay off the balance. All remaining equity is inherited by the estate. The estate is not liable if the home sells for less than the balance of the reverse mortgage.”
History of Reverse Mortgages
Many people believe that reverse mortgages are fairly new, when actually the first reverse mortgage was done by Deering Savings & Loan in Maine during 1961. Growth was very slow until 1988 when the Federal Housing Authority Insurance Program was signed into law. The first government-insured reverse mortgage was given in 1989 under a pilot program initiated by the federal government under the guidance of the AARP. The program was small to begin with, but was expanded nationwide due to its success.
Since then in excess of 400,000 reverse mortgages have been done in our country.
Why a Reverse Mortgage?
The FHA reverse mortgage was created to allow seniors to stay in their homes for the rest of their lives. The homeowner can receive payments in a variety of ways; monthly payments, lump sum payment, line of credit, or any combination, and because they are receiving rather than paying, they can never be evicted or foreclosed on for non-payment. Reverse mortgages are easy to qualify for because there are no credit or income requirements.
What Can Be Done With The Proceeds of a Reverse Mortgage?
According to a report on the 2006 AARP National Survey of Reverse Mortgage Shoppers, the top 5 uses of a reverse mortgage are:
Expenses for health or disability
Improve quality of life
Pay off debt
Home repairs and improvements
Everyday and emergency expenses
The proceeds are not taxable and the borrower can do almost anything they want with them.
The Brian Maecker Team
RE/MAX Advantage 5590 N. Academy Blvd.
Colorado Springs, CO 80918
Phone: (719) 593-2963
Fax: (719) 599-7777
Email: TheTeam@Maecker.com
